By ANNELIA NIXON

anixon@tribunemedia.net

The Central Bank of The Bahamas revealed yesterday at BICA’s Accountants Week it is in the process of implementing a new initiative referred to as the Fast Payments System which Deputy Governor Derek Rolle said will come into action in the next few years.

While emphasising the point that Fast Payments does not equate instant payment, Mr Rolle, said work has already begun on the project.

“We’ve started some preliminary work already on the fast payments project, but we anticipate that we will probably accelerate this process considerably in 2025 and beyond,” Mr Rolle said. “But we anticipate that within the next three years the country will have a fully functioning Fast Payments infrastructure.”

Me Rolle said the Fast Payments system isn’t technically new but “the thought behind the process is new”. He said the infrastructure has existed for over a decade.

“For those of you who are very familiar with the Real Time Growth Settlement system, the RTGS, it’s a system that is used by the banking industry along with the Central Bank to really settle payments on a gross base - one by one payments on an interminable basis.

“What many people have may not have noticed if we did our jobs well at the Central Bank already is that we’ve already started to ready the infrastructure behind the scenes to accommodate this. We have increased the daily clearing sessions with the ACH. What used to be seven sessions a day is now ten sessions a day. We’ve expanded the ‘open to business’ window of the RTGS to start to accommodate this.

“By the middle of next year, RTGS will be running 24/7 because you need a 24/7 payments now network to be able to settle fast payments.”

Denise Turnquest, president of Commonwealth Bank Ltd, said the cost of accommodating the Fast Payment system is hefty.

“We don’t have the parent with the big deep pockets and with the technological resources that our counterparts in the industry have,” Ms Turnquest said. “It is very challenging and expensive. Certainly in the last year we have spent a tremendous amount of money in, I would say getting our foundation in order to facilitate these changes that are coming down the pipe. And you know, these are things that you don’t see and feel that you can’t say, ‘okay, I spent this amount of money and see it right there.’ But it is essential for the safety and soundness of the bank and for the ability to continue to compete and to continue to provide the services that our customers are demanding that we expend these amounts. So similarly, as we move forward to the fast payment system - the Central Bank has already engaged us, our technical teams - I think the meetings are starting this month to talk about what is going to be required. So I don’t quite know yet the dollar impact, but I do know that in the interest of moving the banking system forward, it is something that we must do and we must do together and we must move ahead.”

Mr Rolle added that Fast Payments will make that move to the retail space.

“What people very often call the movement of money across these networks is not really the movement of money as it is a messaging system between the counterparties,” he said. “Saying that I’m doing this transaction on this side, I need you to reflect this in this way on the other side. The real time gross settlement system that we’ve owned and operated since 2004 does this instantaneously now at the wholesale level for the commercial banks.

“Really what Fast Payments will do is advance this into the retail space. So we’ll be able to now, through the Fast Payments network, both from the deposit accounts at the commercial banks as well as in digital wallets, settle payments almost instantaneously in a very fast way- two to three seconds across a very elaborate digital network.